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Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Campbell Company manufactures a personal computer designed for use in
Problem: Module 6 Textbook Problem 3 Learning Objective: 6-2 Make appropriate special order decisions Campbell Company manufactures a personal computer designed for use in schools and markets it under its own label. Campbell has the capacity to produce 29,000 units a year but is currently producing and selling only 13,000 units a year. The computer's normal selling price is $1,760 per unit with no volume discounts. The unit-level costs of the computer's production are $440 for direct materials, $140 for direct labor, and $120 for indirect unit-level manufacturing costs. The total product- and facility-level costs incurred by Campbell during the year are expected to be $2.270,000 and $800,000, respectively. Assume that Campbell receives a special order to produce and sell 3,060 computers at $1,220 each. Required Calculate the contribution to profit from the special order. Should Campbell accept or reject the special order? Answer is complete but not entirely correct. Contribution to profit 520 Should Campbell accept or reject the special order? Accept
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